Injunctions: the primary remedy
Because you cannot put the genie back in the bottle, an injunction is usually the real remedy for breach of confidence. Interim injunctions follow American Cyanamid v Ethicon [1975] AC 396: a serious question to be tried, whether damages would be an adequate remedy, and the balance of convenience. For confidentiality, damages are typically inadequate - once the information is used or disclosed, money is a poor substitute - so the balance often favours an injunction.
The Court of Appeal underlined this in Derma Med Ltd v Ally [2024] EWCA Civ 175, holding that damages will rarely be an adequate remedy for breach of non-competition and confidentiality obligations, given the difficulty of identifying and quantifying the loss, and granting injunctive relief to hold the defendant to what was bargained for.
The springboard doctrine
Springboard relief is a distinctive confidentiality remedy. Originating in Terrapin Ltd v Builders' Supply Co [1967] RPC 375, it prevents a recipient from using confidential information as a springboard for activities to the confider's detriment - and, unlike a standard injunction, it aims to eliminate the unfair competitive advantage gained from past wrongdoing, not merely to stop future misuse.
Its scope has grown: in Create Financial Management LLP v Lee [2020] EWHC 1933 (QB), springboard relief was extended beyond breach of confidence to breaches of express positive contractual obligations. So a head-start obtained by wrongdoing can be neutralised even where it is not, strictly, misuse of information.
Damages are hard to quantify
Quantifying loss for breach of confidence is genuinely difficult, and the wrong measure can be fatal to a claim. In Marathon Asset Management LLP v Seddon [2017] EWHC 300 (Comm), employees had unlawfully copied tens of thousands of documents, but the claimant ran its case solely on a licence-fee basis valued at around GBP 15 million; the court rejected that measure and, finding no financial loss proven, awarded just GBP 1 in nominal damages against each defendant.
The lesson is to choose the damages methodology with care. Had the claim been framed for the time and expense the defendants saved by misusing the information, a substantive award might have followed. Plead the measure that fits the facts.
Negotiating (Wrotham Park) damages
Where compensatory loss is elusive, negotiating damages may bridge the gap. Morris-Garner v One Step (Support) Ltd [2018] UKSC 20 clarified that such damages - the fee the claimant could reasonably have charged to release the obligation - are available where the breach results in the loss of a valuable asset created or protected by the right infringed, and Lord Reed identified confidentiality obligations as a potential candidate. They are not automatic, but they are a real option.
In the right case the award can be large: in CF Partners (UK) LLP v Barclays Bank Plc [2014] EWHC 3049 (Ch), the court awarded around GBP 10 million in negotiating damages for breach of confidence in an M&A context. And liquidated damages can be used to fix the sum in advance, enforceable under the Cavendish test (out of all proportion to a legitimate interest).
Drafting the remedies clause
Draft to support the injunction you will need. Acknowledge that breach of the key obligations may cause irreparable harm for which damages are an inadequate remedy, and that the disclosing party may seek injunctive or equitable relief without proving actual damage and without posting security. Such an acknowledgment is persuasive evidence in an injunction application.
Crucially, identify which obligations would cause irreparable harm by clause number - specificity is given more weight than a generic recital. Pair this with a considered choice of damages measure and, where appropriate, a liquidated-damages or negotiating-damages route, so the remedy is not left to chance.
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Practical checklist
- Expect to rely on an injunction - damages are usually inadequate for breach of confidence (Derma Med v Ally [2024] EWCA Civ 175).
- Consider springboard relief to remove an unfair head-start (Terrapin [1967] RPC 375; Create Financial v Lee [2020] EWHC 1933 (QB)).
- Choose the damages measure carefully - the wrong one can yield nominal damages (Marathon v Seddon [2017] EWHC 300 (Comm)).
- Consider negotiating (Wrotham Park) damages where compensatory loss is elusive (Morris-Garner [2018] UKSC 20; CF Partners v Barclays [2014] EWHC 3049 (Ch)).
- Include an irreparable-harm acknowledgment and an injunction-without-security provision.
- Identify the obligations that would cause irreparable harm by clause number.
This guide is informational only and is not legal advice. It does not replace advice from licensed counsel on the facts of a specific transaction.
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